United Airlines Playing Fast and Loose with IAH

The news of Houston’s Hobby airport receiving permission from the city to start international flights was big. Lots of people are happy, making the assumption that Southwest Airlines is going to significantly lower costs in the Houston-Latin America market. That is a different discussion, the real focus of my attention lately has been United Airlines’ reaction to the news.

United Express

Three big things were announced by United shortly after the news that Hobby would become an international airport; There would be 1,300 employees laid off in the Houston area, the Houston-Auckland route would be going away, and there would be other capacity cuts. For all three of these announcements, United directly blamed Houston city council and their approval of the Hobby expansion plans.

Laying off 1,300 employees now, due to an expansion that will not be complete until 2015 seems a bit strange doesn’t it? That is probably because these cuts have been planned for a while now and United is using the Hobby news as cover. United has not been specific over who will be laid off, but I would be willing to guess that a lot of the layoffs will not be focused on airport employees. United is going to try and consolidate their operations staff and their headquarters staff. Look for layoffs of back office employees and some front line folks.

The Houston-Auckland route cancellation is a bit different. There is a very real possibility that the route being cancelled is partially due to the Hobby Airport news. The idea behind the route was the connecting of Latin and South America to the Oceania region. Currently, the market is only served by Aerolineas Argentinas and Qantas, both offering limited coverage in South America. I have had a few people say to me that there’s no way United was basing this route on this traffic alone. Sure they were. The 787 is perfect to make money on the Houston-Auckland route with connecting traffic split between the U.S. and Latin and South America. Between passengers and cargo, the route could have been very successful. However, between fuel costs, the economy, and now the news about Hobby, United must have reevaluated the route and decided against it.

Lastly, United has said there will be capacity (flight) cuts due to the Hobby expansion. These cuts too, were probably planned before the Hobby changes ever gained traction. First, United is retiring all of their 737-500s and a lot of the older, pre-merger, United 757-200s. That’s a lot of capacity cut simply because the planes are older and inefficient. But blaming such cuts on the expansion of Hobby is a stretch.

In all of this, United is doing something that in my mind is very dangerous. They have been very vocal against the expansion of Hobby. The news organizations picked up on this and started calling it an “airline war” when the issue of Hobby’s expansion is one that concerns the city as a whole (or, at least it should). Instead, United has dived straight in and tried to fight this as bad for them instead of focusing on impact to the city, the city’s growth, and the infrastructure around Hobby. These are the issues that we as Houston citizens should be asking about.

I think United should have been upfront on why exactly international flights from Hobby would affect international traffic out of Bush Intercontinental, rather than just painting some broad strokes and hoping that people understood. What United has done has left a bad taste in a lot of people’s mouths because they can see through the “we’re laying people off because of Hobby expansion” rhetoric. The timeline does not match up.

In reality, the merger has made some inefficiencies in the IAH hub, especially for southern east coast to northwest coast connections. Why have all of that traffic go through IAH when you’ve got flights with empty seats leaving from Denver and an incentive from the city of Denver to push more traffic through that hub? But, using the Hobby news to cover your butt on such changes is bad public relations and passengers are able to see through the charade.

What United should have done is immediately offer some specials to the markets that Southwest considering entering. The goal should be to convince customers that you are the best carrier for a particular route, not to create ill will by announcing layoffs and route reductions. Compete on service, price, and reach and go head to head with Southwest.

The future of IAH is simple, United is not going to abandon a fortress hub. They’ll attempt their political game but it will backfire, we’re already seeing that, then they will be forced to compete but will now be digging themselves out of a public relations hole. I am willing to give United a little leeway but they are trying my patience and I’m sure other Houstonians feel the same way.

The city pulled the trigger on this plan solely focused on the wrong thing, airfare. City council needs to evaluate the impact to the surrounding neighborhoods and what improvements to infrastructure will cost (Southwest will not be picking up those costs) rather than thinking about how much the flight for their wild Cancun weekend will cost. The impacts to air traffic and passengers should be examined more closely as well. The CAPA study is a great resource. At the same time, United needs to reevaluate their “protest” of the city’s decision. Focus on how you can make the traffic you are relying on for these routes stick with you United rather than doing everything in your power to drive them away. This is Marketing 101.

Houston’s Hobby Airport Will Become an International Airport

Yesterday, news broke that a press conference to take place at Hobby Airport was scheduled by Mayor Annise Parker. It was pretty easy to speculate what it would be about, the future of Hobby Airport and Southwest Airlines’ desire to fly international flights from there. It came as no surprise that the press conference was the confirmation of the speculation, that Hobby would have an international terminal and immigration facility built. What did come as a surprise were a few of the details.

  • Southwest Airlines will pay for the entire cost of construction
  • No passenger service charges will be added to tickets due to construction
  • For Southwest’s part in building of the terminal, they will receive preference on four out of the five gates being built
  • Southwest will pay no rent on the terminal or the customs and immigration facilities
  • Rebates will be made available for other carriers who start operations at Hobby and bring an increase in passengers
  • The City of Houston will be the owners of the terminal after construction

A piece that was kind of mentioned in passing was Southwest’s lease term. It sounded like a 25-year lease but I am not 100% on that.

All around, I’m sort of ambivalent. It is good news that the city is not footing the bill, it shows that Southwest is serious about the international operations. However, I do think the full ramifications of more traffic out of Hobby are not completely understood. None of the studies done looked at car traffic, parking, etc. These are important items for the community and I hope they are addressed before construction is underway.

The other piece is United’s threats of moving flights and how serious they are about following through on them. We may see a few flights announced from other hubs but I have no doubt that United is going to want to compete in the Houston market.

TSA Leaves Metal Detector Unattended

A TSA checkpoint was left unattended in Sacramento

Officials told KCRA 3 that four of the individuals were ticketed passengers and one was an airport employee. According to TSA officials, “a walk-through metal detector was left unattended for less than one minute.”

And if that story was not enough, here’s a great write-up on why the TSA should go away, written by a former FBI agent.

Why Does the TSA Need to Shame People?

I ran across this article the other day and I can’t help but feel sorry for the woman involved. Lori Dorn is a breast cancer patient who had a bilateral mastectomy in April and, as a result, had tissue expanders inserted to make way for a later breast implant. During a TSA body scanner inspection at JFK these tissue expanders caused Lori Dorn to be pulled aside for “secondary” screening. She explained her situation and asked to retrieve the cards with the expander information. She was refused this courtesy and was told that unless she underwent the secondary screening of her breast area she would not be flying that day.

The TSA agents have a job to do, I understand that, but they should treat their jobs with the same dignity and respect that they would want to receive. It is ridiculous that this woman was not able to retrieve the card explaining the expanders, even though not being able to see your bags is a violation of the TSA’s own suggestions. There has to come a point where we say “enough” and rectify this situation.

My last few trips have shown me that more and more people are becoming comfortable with these TSA procedures, making it harder to ever change them.

 

[disclaimer] The article website contains language that is not suitable for young people and is fairly strong. [/disclaimer]

Coming to an Airport Near You

A few weekends ago I took a trip to Quito, Ecuador and was subjected to the displeasure of the newest addition to the TSA’s anti-terrorism toolbox; The full body scanner.

 

The full body scanners do exactly that, they scan the entire body, through the clothing to produce a near naked image for a TSA employee to ponder over before letting the traveler go about their business.

There is only one such scanner currently at IAH and it is in Terminal E.

On the day that I was flying, the traffic through Terminal E was light so everyone was being subjected to the full body scan. There was no signage anywhere explaining what the scanner was, people were just being directed into the device and told to “raise your hands in the air”.

Knowing what the machine was and what job it performed, I let the agent know that I would “opt-out” and preferred the personal screening. I assumed that this would be done like it has always been done, behind a screen out of the public eye. Nope, not this time. The pat-down was more thorough than a doctor during a physical and was performed right out in the open in front of everyone walking by.

This is unacceptable, plain and simple. It was quite obvious that they were trying to test the machine during a lull in the crowd and were using the pat down as an embarrassment tool to persuade me into going through the machine next time.

We are sacrificing our freedoms in the name of security and it’s irresponsible.

Next time, I’ll just go through Terminal C and avoid the unwanted feel-up by the TSA.